Newspapers Try to Reimpose Scarcity on News with Ongo

In what feels like another attempt to put the Internet genie back in the bottle, three traditional media companies—The New York Times, The Washington Post, and the Gannett chain, publisher of USA Today—have launched a new service called Ongo that they hope will persuade readers to pay for their content, even though much of that content is already available for free. Although it has some interesting features aimed at compensating readers for sharing content, Ongo seems like yet another Hail Mary pass aimed at trying to rewind the clock and impose scarcity on media content, and one that will likely fail just as quickly as others have.

Ongo is run by former eBay and PayPal executive Alex Kazim and has received $12 million in funding from the NYT, The Washington Post, and Gannett.The service charges users $6.99 a month for access to content from its three main backers as well as from the Associated Press, the Financial Times, and The Guardian. "People are getting their news online in lots of different ways," Kazim told PaidContent. "This is another option. We believe it recognizes the way people read on the Web. They don't just read one outlet." If that sounds a lot like Google News to you, you're not the only one.

Ongo further complicates things by giving readers who pay the $6.99 only the top 20 stories from The New York Times (which appears to be hedging its bets), as well as stories from The Washington Post and USA Today. Readers who want other content will have to pay à la carte for it, which seems needlessly complex and will likely turn many off. The service includes incentives for sharing—subscribers can earn credits by sharing stories with people who then sign up for the service, and bloggers can apparently earn credits, as well as possible cash compensation for linking to Ongo stories—but it's not clear whether these credits are going to be enough of a carrot to draw many users.

Alesia Down the Drain

Ongo sounds similar to a service that Rupert Murdoch's News Corp. conglomerate was working on for more than a year, which was code-named Project Alesia (after a famous campaign by Julius Caesar) and was designed to aggregate not just content from The Wall Street Journal, the London Times, and other Murdoch papers, but was also working on partnerships with other chains to make their content part of the paid service. The project was killed in October, just a few weeks before it was supposed to be launched, but not before it had spent a reported $30 million and hired more than 100 staffers. It's not clear whether Ongo was in development before Alesia or is a spinoff.

Will some people pay for Ongo? Probably. But no one who knows how to use an RSS reader or who follows news sources via Twitter or Facebook is likely to do so, since they are already getting much of that news for free. And even when The New York Times launches its paywall, which it is expected to do soon, people who come in via social media, such as Twitter and Facebook, and from blogs will likely still get access to NYT content—according to comments from Times Chairman Arthur Sulzberger Jr.—and so will those who come to the Times website only occasionally, since it will be metered access.

The only way something like Ongo would really work is if everyone decided to put content behind a paywall and cut off their RSS feeds. Even if that were to happen, other sites or individual users would just log into the pay service and copy the content and the post it somewhere, which others would then link to. Just like iPad apps and other similar approaches, Ongo is yet another attempt to reimpose the scarcity model that newspapers lost when the Web first arrived. Although it might seem presumptuous to condemn something on the day it is launched, this latest attempt seems almost certain to fail.